Impact investment fund backed by Gates Foundation making its mark on the developing world

///Impact investment fund backed by Gates Foundation making its mark on the developing world

Impact investment fund backed by Gates Foundation making its mark on the developing world

Dr Curt LaBelle (pictured) is Managing Partner at GHIF and has over 16 years’ investment experience in the healthcare space. He says that the fund’s impact is defined by “lives saved and lives improved in the developing world”.

“That also applies to the developed world but the impact measurement is focused on how we’re making new technologies and therapies available where they otherwise might not be.

“Every company we invest in must have an innovative product that serves the needs of the developing world and it needs to be delivered at a relatively inexpensive price point.”

“It has to be a product that is relatively easy to learn as well; we could say cardiovascular disease is a major problem in the developing market, and here’s a new device that addresses it, but if that product costs USD25,000 and you need a trained cardiologist to use it, it’s not accessible to low income countries and it’s never really going to generate the right impact in the developing world.”

“We want each product we invest in to be readily available in the developing world and in most instances we need to make sure that it can do well in the developed world and provide good financial returns for the fund given our double bottom line investing approach,” says LaBelle in GHIF’s offices opposite Bryant Park in mid-town Manhattan.

Although modest in size, approximately USD108 million in AUM, the fund has significant patrons backing its success, most notably the Bill & Melinda Gates Foundation. They also include the Children Investment Fund Formation, Grand Challenges Canada – one of Canada’s largest impact investors – BMZ, Germany’s Federal Ministry for Economic Cooperation and Development and the Pfizer Foundation.

GHIF typically invests from USD5 million to USD15 million in healthcare companies that have achieved a clinical proof of concept for their product.

“It has to be something that’s been tested and we have some data on a target population we can use to compare and contrast to other products and see whether it has some advantages. We less frequently invest in products that are in the early stages of commercialisation. We are comfortable investing alone or as part of a syndicate with other investors. We supported the development of a drug for river blindness and were the only investor, for example,” says Dr. LaBelle.

River blindness affects 25 million of the poorest of the poor in sub-Saharan Africa. GHIF backed a drug called Moxidectin, developed by Medicines Development for Global Health in Melbourne, Australia. It is not a typical investment by GHIF as river blindness is unique to the developing world only. Nevertheless, it is a huge problem and Dr. LaBelle hopes that the new drug should cure all those afflicted by the disease.

What makes this investment particularly exciting is that the FDA has rewarded MDGH a priority review voucher. This voucher programme was set up by the FDA to encourage more innovation to combat tropical and infectious diseases in the developing world.

“They put a list together and said that if anyone develops a drug to treat any of the conditions on that list they would review it within six months, and if they approve it they would also give the drug developers a voucher that is good for review for any drug of their choice within six months; instead of 12 months, which is the usual case.”

“Healthcare companies are free to sell these priority review vouchers in the marketplace. We hope to sell the voucher where a portion of the proceeds would go towards producing and delivering the drug, and the remainder will be split between us and MDGH, so it should make a nice return for our investors,” comments Dr. LaBelle.

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